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Washington, DC – Today, U.S. Representative William J. Jefferson announced that an update of his “tonnage tax” provision was included in the final tax reconciliation conference report. The full House is expected to vote on the conference report today. The “tonnage tax” provision benefits United States-flag vessel owners such as Central Gulf Lines, Inc., Waterman Steamship Corporation, Tidewater, Intermarine and other American maritime companies headquartered in New Orleans and engaging in international trade. It allows companies to elect a U.S. tax regime based on the “tonnage” – or weight in tons – of a taxpayer’s U.S.-flagged ships, instead of regular income tax, making those companies more viable in the global market.
“The tonnage tax provision has the potential to bring hundreds of jobs to our Port for Louisiana’s mariners and possibly thousands of mariners all the way up the Mississippi River by boosting the lagging U.S. flag vessel fleet,” Jefferson said. “I am pleased to have helped bring such meaningful legislation through Congress.”
The original “tonnage tax” provision was signed into law as part of a corporate tax bill in 2004. Under current law, vessels weighing more than 10,000 deadweight tons (“DWT”) may elect into the tonnage tax. The conference report approved today reduces the weight threshold to 6,000 DWT, thus allowing more vessels to participate and become more competitive through the election of the tonnage tax regime.
“It is my mission to fight for Louisiana’s jobs,” Jefferson said. “This tax reform measure will make our two biggest New Orleans industries – shipping and trade – more competitive. With this legislation, we are making these sectors stronger and better able to grow and create jobs in Louisiana during our continuing recovery.” |
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